The Market Composite Index, a measure of mortgage loan application volume, decreased 3.6% on a seasonally adjusted basis from one week earlier.

The Refinance Index decreased 0.1% from the previous week. The seasonally adjusted Purchase Index decreased 8% from one week earlier to the lowest level since February 2014. The unadjusted Purchase Index increased 16% compared with the previous week and was 17% lower than the same week one year ago.

The refinance share of mortgage activity increased to 54% of total applications from 52% the previous week. The adjustable-rate mortgage (ARM) share of activity remained unchanged at 8% of total applications. The average loan size for purchase applications was $268,500, the lowest amount since February 2014.

“While we try not to put too much focus on week-to-week fluctuations, it can be disappointing to see any substantial drop in purchase activity,” said Quicken Loans vice president Bill Banfield. “But based on the where the July 4th holiday fell this year, it’s possible many homebuyers were enjoying a vacation with their family instead of applying for a mortgage. With the slightly increased inventory and falling to steady interest rates, there are still many opportunities to buy available.”

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to 4.33% from 4.32%, with points increasing to 0.20 from 0.16 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) decreased to 4.23% from 4.24%, with points increasing to 0.26 from 0.16 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 4.04% from 4.02%, with points increasing to 0.02 from -0.03 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.

The average contract interest rate for 15-year fixed-rate mortgages increased to 3.41% from 3.40%, with points increasing to 0.23 from 0.22 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.

The average contract interest rate for 5/1 ARMs decreased to 3.17% from 3.24%, with points increasing to 0.34 from 0.31 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.

Trey Garrison is the Senior Financial Reporter for HousingWire.com. Trey has served as real estate editor for the Dallas Business Journal, and was one of the founding editors of D CEO Magazine. He has been an editor for D Magazine — considered among the best city magazines in the United States — and a contributor for Reason magazine.

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